17.05.2019

Investing News

Scepticism before optimism.... 


Something I noticed this week....

If your researching companies, it's crucial that you can differentiate between journalistic 'puff pieces', and well researched, factual and logical articles/publications by financial 'professionals'. 

Here's two articles from the same website, Livewire (a good portal for anyone looking for investing related news). 

Both articles concern the Disney Investment thesis. 

Article 1

Article 2 

Consider the difference in the two articles. They are both talking about the exact same thing, Disney's move into the streaming market. Yet they have reached vastly different conclusions. 

Which article presents it's case better, the bull (1st), or the bear (2nd)?

 


"Scepticism before optimism'



The first article was written by someone who's clearly long Disney stock. The author paints a rosy picture of their theme parks, high grossing movies and extensive consumer reach. It all sounds wonderful, and it's such an easy throwaway investment thesis. At parties when one asks why you've invested in Disney, this is the fluffy picture you paint for them. 

The second article is in deep contrast with the first, not on topic but in substance. It looks beyond the fluff, and gets into the numbers and facts. The simple fact is that if Disney pull (remove) their movies and shows from Netflix, they lose 41% of their revenue. Their streaming service will be run at a loss for several years, which is going to hurt investors. 

Both articles are talking about the same thing, with vastly different opinions. Share prices are essentially opinions about companies, the popular opinion always wins in the short term, but the RIGHT opinion always wins in the long term....

The first article personifies herd mentality, that being the uneducated, ignorant opinion which is held by the masses. 

The second article is the opinion of an educated, rational, logical, researched and objective investor who can look at investments not as stories, but as companies who generate returns from capital invested.  

We can so easily be mesmerised by a potential investment, and get sucked into the mainstream narrative....However once we look deeper and start to get into the nitty gritty, we find that in reality, its a terrible investment. 

 

Bullsh*t of the week

The Harbour Bridge protesters 

I’ve always wondered what goes through the minds of fanatical protesters, can they justify their actions to each other and themselves? Do they sleep sound at night believing they are making positive contributions to social justice?

If you want to start a conversation, or maybe even make some meaningful change, making a d*ck of yourself in public is not the answer.

The signs they were brandishing were requesting for the abolition of coal…….Anyone asking for the abolition of coal is quite frankly an idiot, coal gets all the lights on, and provides the major source of stable power for Australia. 

100% renewable's is a pipe dream by stupid people with no grip on reality, it's a utopia that doesn't exist. 

For one, the sun isn't always shining, the wind isn't always blowing, and the water isn't always flowing (solar, turbine, hydro). 

Two, energy prices in Australia are already significantly higher than many OECD nations, what do you think will happen if they turn from the most efficient form of energy, to the least.....And who's going to pay for it you silly Greenpeace hippies.....

Renewable's will likely play an increasing part in powering our society, but will never become the baseline power generator, thus coal is here to stay.

Instead of protesting, these people should either be living in wooden huts, or working in science labs coming up with better renewable energy sources. Yelling and complaining doesn’t achieve anything.

NBSInvesting